Hyundai Mobis to issue its first ESG bonds
The first environmental, social and governance (ESG) bonds issued by Hyundai Mobis attracted trillion won, four times its underwriting target.
Subscriptions for the bonds, which have a credit rating of “AA +”, totaled 1.08 trillion won in a demand forecast. Initially, the company expected subscriptions to reach 250 billion won.
In the demand forecast, subscriptions amounted to 540 billion won for three-year newspapers worth 130 billion won, to 330 billion won for five-year newspapers worth 80 billion won. billion won and 201 billion won for seven-year newspapers worth 40 billion won. Seven-year papers have attracted more funds because they offer a relatively higher interest rate.
As the bond coupon rate, Hyundai Mobis proposed a band of -20bp to +20bp on the arithmetic average rate of its three-year, five-year and seven-year unsecured corporate bonds.
The bond issue is the company’s first bond sale in 11 years since June 2010. All are issued as green bonds, a type of ESG bond. Hyundai Mobis plans to raise up to 400 billion won based on the results of the demand forecast.